How Utilities Can Build a Smarter Funding Strategy
Making Grants and Utility Capital Work Together
Overview: Tamazari's practical guide to combining grants, public funding and utility capital into one coordinated modernization strategy
The federal push to modernize the grid has been building for nearly five years. In 2021, Congress created the Grid Resilience and Innovation Partnerships program through the Infrastructure Investment and Jobs Act, authorizing up to $10.5 billion to help utilities, states, Tribes and other organizations make the power system more resilient, flexible and reliable.[1]
The Department of Energy announced the first major round of GRIP selections on October 18, 2023, followed by a second round exactly one year later. Together, those rounds represented $7.6 billion for 105 selected projects across all 50 states and the District of Columbia.[1]
In March 2026, the program entered a new phase. On March 12, 2026, DOE announced approximately $1.9 billion through SPARK—short for Speed to Power through Accelerated Reconductoring and other Key Advanced Transmission Technology Upgrades.[2]
SPARK builds on GRIP’s previous two funding rounds, refocusing the program around one of the industry’s most urgent challenges: adding usable grid capacity faster. Applications closed on May 20, 2026. DOE’s published schedule lists August 2026 for anticipated selection notifications, with awards expected between October 2026 and January 2027. [2]
Winning a grant is only one piece of the funding strategy. The utilities that benefit most will know how to combine the award with other funding, cover what the grant leaves out and connect each funded project to one larger modernization plan.
What Does It Mean to Stack Grid Funding?
“Stacking” is often used broadly to describe combining grants, loans, utility capital and other funding. In federal guidance, however, different approaches have different meanings.
Braiding uses multiple funding sources on the same broader project at the same time, while keeping each source separate and independently tracked.[3]
Stacking, also called sequencing, uses different funding sources in a deliberate order. One source might support planning, another construction and another a later phase of technology deployment.[3]
Co-funding uses multiple sources to pay for one specific measure or activity when the individual program rules permit it.[3]
What utilities cannot do is commingle federal funding in a way that makes it impossible to identify which source paid for which work or produced which outcome. Federal spending and results must remain traceable to the appropriate award. The distinction matters because a funding strategy is not simply a larger pool of money. It's a coordinated financial structure in which every source has a defined role, eligible scope and reporting trail.[3]
1. Start With the Power Grid Outcome, Not the Open Grant
A common mistake is to find a funding opportunity and then work backward to invent a project that fits it. That can produce an eligible application, but not necessarily the most valuable investment. Instead, begin with the operational outcome the utility needs to achieve. That could include:
Increasing transfer capacity through an existing corridor
Reducing restoration times after severe weather
Improving visibility across remote substations or field assets
Accommodating major new industrial or data-center loads
Replacing aging communications infrastructure
Reducing the number of disconnected control-room systems
Improving the ability to operate safely during degraded conditions
Once the outcome is clear, define the complete body of work required to achieve it.
For example, a reconductoring initiative may require more than new conductors. Looking at the entire operating model makes it easier to identify which parts could qualify for grant funding and which parts will likely require internal capital or another source.
2. Break the Modernization Program into Fundable Work Packages
Funding is easier to coordinate when the modernization program is divided into distinct, defensible work packages. For a utility that wants to increase capacity and resilience along an existing transmission corridor, its program might include:
Work package | Potential funding role |
System studies and preliminary engineering | Utility planning budget, state support or technical-assistance funding |
Advanced reconductoring | Transmission-focused federal grant or financing |
Sensors and dynamic monitoring | Smart-grid, resilience or technology-deployment funding |
Communications upgrades | Resilience grant, broadband-related support or utility capital |
SCADA, EMS, GIS or data integration | Eligible grant costs, utility capital or a separate modernization initiative |
Cybersecurity and access controls | Cybersecurity funding or utility capital |
Training, procedures and change management | Allowable project costs or internal operating budget |
Long-term maintenance and support | Utility operating or capital plan |
Examples are illustrative. Eligibility, cost share and allowable uses vary by program and award.
The strongest funding strategies align each source with the part of the program it can support most effectively. DOE’s SPARK opportunity, for example, emphasized advanced reconductoring, technologies that increase the usable capacity of existing infrastructure in real time, and upgrades that can deliver measurable benefits quickly while using existing rights-of-way. That could make it relevant to the physical capacity portion of a larger modernization strategy.[2]
A separate resilience program might be better aligned with hardening, self-healing devices, communications or field dispatch improvements. Previous GRIP selections have included advanced conductors and controls, self-healing technology, line upgrades and tools intended to improve outage response and field-team dispatch. Utility capital might then cover integration, lifecycle support or other work that does not fit cleanly within a federal program.[1]
When the work is separated into meaningful packages, the utility can pursue funding without creating overlapping scopes or trying to force every cost into one application.
The result is one modernization strategy supported by several coordinated financial sources.
3. Decide Whether to Braid, Stack or Co-Fund the Work
Not every funding source needs to arrive at the same time. In many cases, sequencing may be more practical than trying to fund everything simultaneously. A utility might use its own capital to complete early engineering and environmental work, pursue a federal award for construction, and then use a later technology program to add monitoring and control capabilities. Another utility might braid a state resilience award with utility capital, assigning each source to separate work packages delivered during the same construction period. The choice should be based on:
When each source becomes available
How quickly the money must be obligated
Whether the recipient and project are eligible
Which activities can begin before an award is finalized
Whether one phase depends on the completion of another
How introducing a new funding source could affect compliance across the project
The DOE guidance recommends comparing eligibility, requirements and timelines before choosing whether to braid, stack, blend or co-fund different sources.[3] This planning should happen before applications are submitted, not after multiple awards have already created conflicting schedules and obligations.
4. Build the Cost-Share Strategy Early
Many federal programs require recipients to contribute a portion of the project cost. That contribution might come from utility capital, state or local funding, approved third-party contributions or other allowable non-federal sources. But utilities should not assume that one federal grant can automatically be used as the required match for another.
Under federal cost-sharing rules, a contribution generally cannot be counted toward more than one federal award. Funds paid by the federal government under another award also generally cannot be used as match unless the applicable authorizing statute specifically permits it. Contributions must be allowable, reasonable, necessary and verifiable in the recipient’s records. [4] That means the cost-share plan should answer several questions from the beginning:
Where will the match come from?
Has that money already been committed elsewhere?
Is the contribution an eligible project expense?
Can it be documented?
Will it still be available when the project reaches the required phase?
A technically strong application can still create execution problems if the utility has not secured the internal budget, approvals or partner commitments needed to meet its share.
5. Treat Compliance as Part of Project Design
Each additional funding source introduces its own terms, eligible costs, reporting deadlines and compliance requirements. Depending on the program, these may include environmental review, domestic-content requirements, prevailing-wage requirements, procurement standards, cybersecurity conditions or restrictions on when work can begin.[3]
In some funding structures, requirements introduced by one federal source may affect a larger portion of the project. Utilities also cannot divide a project artificially for the purpose of avoiding federal compliance obligations. The DOE recommends keeping funding streams separate, comparing program requirements and maintaining ongoing communication with legal counsel and the relevant federal project officers.[3]
Compliance is not paperwork attached to the end of the project. It is one of the project’s key design constraints.
6. Create One Funding Map and One Integrated Schedule
A stacked initiative needs a master view that shows how the individual awards fit together. At a minimum, the utility should be able to see:
The scope assigned to each funding source
Eligible and ineligible costs
Cost-share commitments
Application, obligation and expenditure deadlines
Environmental and procurement dependencies
Reporting periods and responsible owners
Construction and technology dependencies
Risks if an award is delayed or not received
The utility capital required to close remaining gaps
This allows leadership to distinguish between the project schedule and the funding schedule. The two are related, but they are not the same. An engineering team may be ready to issue a contract while the grant team is still waiting for environmental clearance. A field deployment may be complete while the integration work funded under a separate initiative has not begun. A grant may pay for new technology without covering the staff capacity required to administer the award.
Without a coordinated schedule, the utility can receive multiple awards and still be unable to move the overall program forward efficiently.
7. Fund the Integration, Not Just the Equipment
Integration needs to be included in the funding strategy from the beginning.
Before assigning funding to individual assets, utilities should identify the connective work required to make those assets function as one system. That may include integrating SCADA, EMS, GIS and asset data; updating communications interfaces; establishing cybersecurity controls; rationalizing alarms; testing the complete environment; and preparing operators to use the new capabilities.
The utility also needs to determine who will pay for that work. Some integration activities may be eligible under the primary grant. Others may need to be supported through a separate award, utility capital or an operating budget. Either way, they need a defined scope, schedule and owner.
Without that planning, a utility could install a new sensor that cannot communicate reliably with the control room, deploy a dynamic line-rating tool that is not incorporated into operating procedures or add field devices that create more alarms than operators can reasonably manage. These are not simply technical inconveniences. They reduce the value of the funded investment and can prevent the utility from achieving the reliability, capacity or resilience outcomes described in the original application.
A complete funding strategy must account for the systems, processes and people required to make the equipment useful.
8. Build the Administrative Capacity to Manage the Funding Strategy
Utilities should also be realistic about the effort required to administer multiple funding streams. Every source may bring its own invoicing process, documentation standards, reporting cadence, audit trail and performance metrics. Administrative costs should be identified and funded rather than absorbed informally by teams that are already at capacity. The DOE’s braiding and stacking guidance specifically recommends ensuring that administrative costs are covered by the funds associated with each program and maintaining systems that preserve funding-stream separation throughout the project.[3]
A clear governance model should establish:
Who owns each award
Who approves expenditures
Who verifies cost eligibility
Who maintains the supporting documentation
Who reports performance outcomes
Who coordinates changes with the granting agency
Who manages the integrated program schedule
Who owns the system after the funded project ends
Winning several grants is not an advantage if the organization lacks the capacity to administer and execute them.
An Illustrative Utility Funding Strategy
Consider a utility that needs to increase capacity through an existing corridor while improving storm resilience and control-room visibility. Its funding sequence could look something like this:
Phase 1: Define the operating need
Utility capital supports system studies, preliminary engineering, asset assessments and the initial integration architecture.
Phase 2: Fund the physical capacity upgrade
A transmission-focused award supports eligible reconductoring or advanced transmission technology.
Phase 3: Improve field visibility
A resilience or smart-grid funding source supports eligible sensors, controls, communications or self-healing equipment.
Phase 4: Connect the assets
Utility capital or another eligible modernization source supports SCADA, EMS, GIS, communications and data integration.
Phase 5: Prepare the organization
Allowable project funding and internal operating budgets support testing, cybersecurity, training, procedures and change management.
Phase 6: Sustain the investment
The utility’s long-term capital and operating plans fund maintenance, licensing, data governance and continuous improvement.
Each phase supports the same operational outcome, but the costs, schedules and reporting remain clearly assigned.
Funding Should Accelerate Modernization, Not Fragment It
Our Tacoma Water telemetry work provides a practical example of why the operating environment must remain central to modernization. The project modernized the microwave communications backbone supporting SCADA across more than 15 remote sites, delivered 99.99% availability, avoided SCADA downtime, maintained continuous monitoring, and strengthened the utility’s readiness for future AMI capabilities.
The value did not come from installing one isolated piece of technology. It came from coordinating communications, field operations, SCADA requirements, implementation and continuity around a larger operational objective.
The same discipline is needed when utilities combine grants and funding programs.
The utilities that do this well will not chase funding from one opportunity to the next.
They will build a modernization roadmap and make the funding work together.
Learn more about our SCADA modernization services
About Tamazari
Tamazari is a woman-owned, veteran-owned, minority-owned Washington-based technology modernization and execution consultancy serving utilities, fleet operators, public agencies and critical infrastructure organizations across the U.S. Our work spans energy IT, SCADA, GIS, ERP/SAP, enterprise modernization, telecom infrastructure, data centers and fleet telematics.
Footnotes
[1] U.S. Department of Energy, Grid Resilience and Innovation Partnerships (GRIP) Program Projects. Used for GRIP program funding, Round 1 and Round 2 selections, the $7.6 billion awarded across 105 selected projects, and examples of previously funded grid-resilience and modernization technologies.
[2] U.S. Department of Energy, Office of Electricity, Speed to Power through Accelerated Reconductoring and Other Key Advanced Transmission Technology Upgrades (SPARK). Used for SPARK funding levels, program priorities, eligibility, the March 12, 2026 announcement, May 20, 2026 application deadline, anticipated August 2026 selections, and expected October 2026–January 2027 awards.
[3] U.S. Department of Energy, State Energy Program, State Energy Office (SEO) Guide to Braiding and Stacking Federal Funds, December 2024. Used for definitions of braiding, stacking, blending, co-funding and commingling; guidance on maintaining separate funding streams; comparing eligibility, requirements and timelines; managing compliance implications; and planning for administrative costs.
[4] Electronic Code of Federal Regulations, 2 CFR § 200.306 — Cost Sharing. Used for federal cost-share requirements, including requirements that contributions be verifiable, necessary and reasonable; not be counted toward more than one federal award; and generally not be paid by another federal award unless specifically authorized.
